Book Reviews

The New 1031 Handbook: Good News for Real Estate Investors
By Bettye J. Matthews, CPA
AuthorHouse, Bloomington, IN (2006)
For those of you that currently invest in real estate, have invested in real estate or are considering investing in real estate, I recommend that you consider purchasing The 1031 Handbook! By: Bettye J Matthews, CPA.
The author, a CPA for more than 30 years, does a fantastic job of taking something as difficult as the Internal Revenue Code (as it pertains to real estate tax-deferred exchanges), and makes it relatively understandable.
She is president of Florida Real Estate Exchange Connection Inc., in Naples, Fla., and Exchange Professionals Inc., in Maryland. As a qualified intermediary and accommodator, she has been involved with numerous 1031 exchanges, which qualifies her as an expert on the subject.
Simply put, a 1031 exchange is when a property owner decides to sell a property (or multiple properties) and wishes to defer having to pay the capital gains taxes. This can be accomplished by taking the sale proceeds and moving them into another property ( or properties) by using the process laid out by the IRS. Please keep in mind that there are multiple rules that need to be followed in such a transaction, so it would be wise to consult with your tax adviser or CPA regarding the process.
As a financial planner, I have been involved with 1031 exchanges, so I understand the complexity of such a strategy, and the power of that strategy when used properly. There are numerous rules that govern the transaction, and if these rules aren’t met, there is the definite possibility that the entire process will be disallowed by the Internal Revenue Service.

What I find refreshing about the book is that it doesn’t bog the reader down with too much industry jargon. I know that I am always a bit out of sort when I am reading about a subject that is out of my area of expertise, and I have to keep asking the question, “What did the author mean by that, what does that term mean?” That being said, when industry jargon could not be avoided, Bettye did a nice job of defining the terminology, and making it easy to understand.
A reader will learn the terminology involved with 1031 exchanges, the different types of exchanges, the time line (which is extremely important with the IRS) which one must follow during a 1031 exchange, types of items to avoid, and what type of exchange might best be appropriate for your unique set of circumstances. The book is written in large text, and has calculations and examples throughout. There are two simplified case studies: one involving a forward exchange, and one involving a reverse exchange. There is also a section dedicated toward showing what the courts have said about 1031 exchanges in past cases. It also does a nice job of covering how a TIC (tenants In common) property can play a positive role in an exchange for those that have invested in real estate, and now wish to relinquish some of the headaches that go along with real estate—management, maintenance, rent collection, etc.–while still enjoying all of the advantages that real estate can offer—steady income, tax advantages, and potential capital appreciation.
Do I believe you will be an expert on 1031 exchanges after reading the book? No, I do not. I do, however, believe the author intended this book to be a guide, a primer if you will. It is a wonderful introduction that takes a pretty complex strategy and breaks it down into something understandable.
~ John Zinaich

A History of the World in 6 Glasses
By Tom Standage
Walker & Company, New York (2006)

A History of the World in 6 Glasses is one of the new wave of popular, but scholarly histories that takes a particular point of departure from the lens through which its vision comes. In the case of this engaging volume, the perspective is beverages— both alcoholic and non-alcoholic.
A glance at the chapter headings brings this into focus. The beginning chapters deal with fermented and distilled libations: Beer in Mesopotamia and Egypt; Wine in Greece and Rome; and Spirits in the Colonial Period. The final chapters cover non-alcoholic beverages that continue in vogue today—Coffee in the Age of Reason; Tea and the British Empire; Coca-Cola and the Rise of America.
I recommend this book not only for its information and but its lighthearted tone. Fascinating nuggets lie on every page. For example, in Mesopotamia and Egypt “wages and rations were paid in bread and beer, as cereal grains were the basis of the economy.” Centuries later, in the Age of Exploration, distillation of spirits resulted in a “compact, durable form of alcohol ideal for sea transport.” Apparently, brandy, rum and whiskey were used as currency to buy slaves.
Coffee was esteemed in England because it promoted “clarity of thought.”Due to the fact that the water to prepare it was boiled, it was as safe to drink as beer, which had previously been the beverage of choice. The subsequent craze for tea led Britain to expand trade with China and India, and in so doing became the world’s first superpower.
And so it goes. Tea was popular in early 18th century factories because it “kept workers alert on long … shifts and improved their concentration when operating fast-moving machines.” In addition, the “natural antibacterial properties of tea were also an advantage, since they reduced the prevalence of waterborne diseases, even when the water used to make tea had not been properly boiled.
The chapter on tea and colonial American history is the clearest exposition of that issue I have read. And the section on Coca-Cola brings us right to the present with an examination of global trade. ~ Tricia Herban

THE GOOD EARTH
By Pearl S. Buck
Simon and Shuster, New York, 1931
First Pocket Books, published in 1973

Pearl S. Buck commented on her choice of China for the setting for the classic The Good Earth: “I can only write what I know, and I know nothing but China, having always lived there.”
Ms. Buck demonstrates her understanding of China and the Chinese people in her graphic view of the country when it was ruled by an emperor and before the social upheavals of the 20th century. This fascinating story of a poor, honest farmer named Wang Lung and his long suffering wife, O-Lan, is especially important reading for anyone who wants to understand and appreciate the vast changes that have occurred in the lives of the Chinese people. The situations and people in The Good Earth were familiar to Pearl Buck as she lived in China for 35 years, from the time she was an infant of three months to when she left to attend college in Virginia. After college she decided to return after she was notified of the illness of her mother still living in China. She married an American who lived there and they made their home in the northern part of that country. After divorcing Dr. Buck, she returned to the United States, married the president of a publishing company and spent her later years raising her family in Bucks County, Pennsylvania.
The story follows the life of Wang Lung thru his years as a poor farmer, with a great love of “the good earth,” through famine, drought, locusts, looting and begging to his rise to the status of a wealthy land owner. We become familiar with his three sons and two daughters, one of whom he calls the “fool,” because her life consists of eating, sitting in corners and twisting a piece of cloth. In a theme related to his higher social status, Wang Lung brings a concubine named Lotus into his house while treating his wife as a servant.
Ms. Buck’s use of simple, but descriptive and lyrical language, while also not confusing the modern American reader, takes you back into a time that is hard for the modern reader to understand. Romantic love was not known in this time in China, and women were chosen as wives for other reasons than love. Wang Lung was one of China’s common people, people that Pearl Buck knew well. His loyalty to his family, his love of the earth and responsibility toward the past and the future are beautifully woven into the fabric of this must-read classic book.
The Good Earth won Pearl S. Buck a Pulitzer Prize. She also was the only woman to win the Nobel Prize in Literature in 1938 for “rich and genuine portrayals of Chinese peasant life and for masterpieces of biography.”

~ Peggy Kiefer

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